Oh, good: American citizenship renunciations are climbing

posted at 1:21 pm on August 13, 2013 by Erika Johnsen

By all means, let the populist cries of “How dare these unpatriotic businessmen even think about relocating their citizenship and assets to a country that taxes away less of their wealth, time, and resources!” ‘Cause that will really fix the underlying problem of the United States’ flagging competitiveness.

A growing number of Americans are exploring whether to renounce their U.S. citizenship or give up their green cards to avoid onerous tax obligations.

While the numbers of those renouncing their U.S. citizenship are small—more than 1,000 people in the second quarter of 2013, out of more than six million Americans estimated to be living abroad—the numbers have climbed this year, according to recently released figures.

The main trigger for cutting ties with U.S., several lawyers say, is the Foreign Account Tax Compliance Act, or Fatca, which requires foreign institutions to disclose the overseas assets of U.S. green-card holders and citizens to the U.S. government. The main objective of Fatca is to identify people who may be evading taxes through offshore investment vehicles. …

Some U.S. citizens say they are exasperated by a growing raft of paperwork that forces U.S. citizens living abroad to declare the minutiae of their financial holdings and other assets. That has increased the attraction of becoming a citizen in places such as Hong Kong, where the individual tax rate is capped at 15%.

President Obama’s utterly fake “grand bargain” the other week, in which he pulled fantastic rhetorical contortions to make it sound like he was somehow compromising with those spitefully obstructionist Republicans on some corporate tax “reform,” because it’s a concession for which Republicans have been vying for a long time. …Except that what Obama offered was really nothing like what Republicans are actually vying for, which is a substantive overhaul that reduces tax burdens, simplifies our intensively complex tax code, and eliminates many of the inherent opportunity costs therein — all of which just happen to be great methods for growing the economy.

Breaking on Hot Air

Blowback

Note from Hot Air management: This section is for comments from Hot Air's community of registered readers. Please don't assume that Hot Air management agrees with or otherwise endorses any particular comment just because we let it stand. A reminder: Anyone who fails to comply with our terms of use may lose their posting privilege.

Yeah and it pisses me off. There are all these Marylanders who are destroying the Commonwealth of Virginia. They don’t like paying for socialism but they are in favor of socialist ideas. They are squatting in Northern Virginia and ruining everything.

It’s an American tradition for a citizen to vote with his feet. In the past, people moved to another territory r state to make a better life. That was when the Federal government wasn’t into everybody’s business. Now, however, with no safe haven from probing Federal eyes and fingers, the only option is to move abroad.

I’ve thought more than once about moving to Canada, which is fifteen miles from where I live now. I’m not wealthy, so it takes a lot of planning and a lot of set up to actually do it.

But it’s starting to look like a better option that might be worth a determined effort.

Like a dysfunctional family, the left and the nations with a leadership poisoned by their ideas, just thinks of taking from their brothers and sisters.

They are blind to the best in others and themselves.

When you have to actually invent phony ethnic groups to keep the every animal for themselves meme going, you are making Hitler’s race fantasy look comparatively like good science and a prescription for comity.

How about a POTUS who looked to take nothing from anybody but get the best from every one of us?

That’s why there is such a push for amnesty. Mexico is essentially the only country slowing everything down. Mexico’s worthlessness is what’s holding back the North American Union. Obama and Friends are trying to push the United States down to the level of Mexico so Mexico doesn’t have to be pulled up.

I say Mexico is the only country holding everything up, but the elites obviously see the legit citizens of the United States as the ones holding everything up because they want secure borders.

Sadly I no longer feel tied to the U.S. even though I live right in the middle of it. I want to move out of the U.S., but right now the wife doesn’t like that idea because of family and friends.

Yeah and it pisses me off. There are all these Marylanders who are destroying the Commonwealth of Virginia. They don’t like paying for socialism but they are in favor of socialist ideas. They are squatting in Northern Virginia and ruining everything.

Happy Nomad on August 13, 2013 at 1:35 PM

Such is the case with progressives who leave the disasters of states they helped create to inflict the same disasters on the localities to which they relocate wielding influence on politics and policies, and in some cases cause property values and property taxes to skyrocket, much to the dissatisfaction of those whose communities are being ruined.

Look, I’m as patriotic as anyone, but what do the IRS and the dopes that run our government expect? It would be one thing if you were living here, and getting (at least in theory) some of the fruits of your tax dollars while nonetheless investing abroad to avoid taxes, but if you’re living and working overseas, and have basically nothing to do with the US, then the IRS is just essentially punishing people for being a US citizen. What did they think was going to happen if they did that?

“How dare these unpatriotic businessmen even think about relocating their citizenship and assets to a country that taxes away less of their wealth, time, and resources!”
==================================

Until,the Hopey Lootery stops,
the business guy and gal,will
keep there loot from the grasp
of the Money Re-Distributing Prog
Tard Goons!!!!

I agree. O/T but N.C. State Senator has announced his Senate race against Graham. He would be the best for our side, if he can survive the race:-) Breitbart has a good article up and he was also interviewed (2nd time) by Beck this morning.

The “greener pastures” is an illusion. If you don’t fight for her, you must adjust that the entire world will be a Zimbabwe-type latrine, soon enough, the US too.

Schadenfreude on August 13, 2013 at 1:42 PM

That’s the thing, all of the scandals have removed any delusions that I once had. While I have always felt a stronger allegiance to my home state (Ohio where I was born and raised and now Missouri where I’ve lived the last 4.5 years) than to the US, I was at one time very patriotic and could never see myself living anywhere else.

Sadly that is no longer the case. Now that the blinders have been lifted, I don’t feel a strong tie or urge to stay in the US. I guess in the grand scheme of things that’s probably what the globalists want, however I don’t feel like a “global” citizen as I would probably try to assimilate as much as possible if I were to move out of the US, but I can’t just fake it because I’ve never been super nationalistic. I’ve always been more state and locally minded, but I’m even beginning to lose that because of the drastic shift that everyone has taken.

I tend to think it’s not just the matter of tax rates or dollars-and-cents. I think disillusionment is the driving force here. There is no one in Congress or really the courts willing to follow the Constitution and Bill of Rights to protect people from the government. Those later elected or appointed soon become part of the giant machine, assuming they held good and honest intentions in the first place.

If not them, then there is little recourse to be done and remain law-abiding.

1 The murderous Islamic pig Major Hasan still gets his pay while the families of those he murdered and wounded get no benefits because the Obama Administration prefers to call this heinous act ‘workplace violence’ in lieu of ‘terrorism’.
2 The murderous Muslim pig Major Hasan is allowed facial hair and the Koran whereas Christians are not allowed to even quote from bibles on military bases.
3 The murderous Muslim rats at Gitmo get served specially prepared Muslim meals costing $14.00 a day while their military guards have to survive on food costing $4.00 a day.
4 In many circumstances in Afghanistan, when a soldier attempts to defend himself from murderous Muslim excrement, they face a dilemma–if you don';t fight back, you will die. If you do fight back, face life behind bars for a hate crime.
5 People who work hard for a living must pay exorbitant taxes so that the same sub-moron Obama voters who destroyed Detroit can get their welfare and food stamps to buy more drugs to destroy other cities in the same manner.

Detroit is a micro-symbol for the entire country thanks to Obama. A vicious cycle where the more welfare spent, the more fraudulent chiselers move into the city which yields more drugs and more crime and more taxes. Those who worked for a living moved out of Detroit. Now those who work for a living are moving out of the USA. It is no longer our America. It is Obama’s America. Amnesty will close down the entire store.

Just heard the hourly news on ABC News. Seems the California Legislature is taking up the pressing issue of paparazzi photographing the children of pop culture icons. Jennifer Garner and Halle Berry tearfully testified how unfair it was that the photographers were “staked out” to take pictures of them and their children.

I say too bad. You’re perfectly fine with the fame when pushing some crappy movie or other project or cause. You are like moths to a flame for the media glare. But you aren’t okay if somebody takes a picture of your child when out and about on the other days? Besides, considering that everybody seems to have a camera these days makes prohibiting such pictures problematic at best. But Jen and Halle you are perfectly welcome to leave if you don’t like it when you can’t dictate the way the media uses you and your families.

Detroit is a micro-symbol for the entire country thanks to Obama. A vicious cycle where the more welfare spent, the more fraudulent chiselers move into the city which yields more drugs and more crime and more taxes. Those who worked for a living moved out of Detroit. Now those who work for a living are moving out of the USA. It is no longer our America. It is Obama’s America. Amnesty will close down the entire store.

MaiDee on August 13, 2013 at 2:02 PM

I think the recent news story out of Detroit epitomizes the problem with decades of liberal mismanagement and fiscal irresponsibility. And no, I’m not talking about the Detroit PD e-mailing the bra sizes of female officers to almost the entire force.

A girl gets raped on the way to work. She has to wait 12 hours at the hospital for a rape kit. It takes five days for the Detroit PD to interview her. It takes three weeks for the Detroit PD to send the rape kit to the lab for analysis.

The neighbors know the identity of the rapist. He lives in the area. The police do nothing. The neighbors beat the crap out of the rapist. And somehow this is a case of “vigilante justice” and not a police department that doesn’t give a damn when a girl gets raped on the way to work.

I tend to think it’s not just the matter of tax rates or dollars-and-cents. I think disillusionment is the driving force here. There is no one in Congress or really the courts willing to follow the Constitution and Bill of Rights to protect people from the government. Those later elected or appointed soon become part of the giant machine, assuming they held good and honest intentions in the first place.

If not them, then there is little recourse to be done and remain law-abiding.

Liam on August 13, 2013 at 1:58 PM

Liam:Yes I agree.

That theme,was talked a bit on CoastoCoast last week,
in that,those that are elected,as stand up good Americans,
are sooner than later corrupted by DC Washington!:)

In the late 90’s and early 2000s I was responsible for interviewing potential technical employees from outside the U.S. for a high tech semiconductor company in Texas. My task was to ensure their education matched their resumes and that they were otherwise authorized to enter the U.S. on work-related visas.

I am not exaggerating when I estimate that more than 90% of them wanted and viewed U.S. citizenship as a “box to tick” to ensure they could remain in the U.S. making very big bucks. They were all eligible for generous salaries, stock options, bonuses and, of course, the benefits from any patents they filed while working.

Of the 90% a large, LARGE percentage of them were quite honest that they had no intention of retiring in the U.S. or of keeping their citizenship.

They frankly advised that once they made their fortunes they planned to return to their homes (mostly India, Pakistan and to a lesser extent China) and renounce their U.S. citizenship primarily because they didn’t want to pay U.S. taxes at their homes abroad.

Since that time I’ve kept track of some of the more prominent engineers and noticed that several have left the U.S. to retire in India and, reportedly, renounced their citizenship. One in particular stands out because I remember his $2MIL bonus for a successful project he was responsible for.

These are rich men today (I don’t think I ever interviewed 10 women during that time) and I suspect they are very well regarded members of their clan, families and communities today, absent that expensive U.S. tax liability.

I am mildly curious how they managed to avoid the horrendous taxes they IRS levies on people who renounce their citizenship/visas but I suspect they had serious legal assistance in doing so.

Anecdotally, I remember a kerfuffle about a China based bank in Houston who almost all the foreign engineers used. The kerfuffle was over a law suit that claimed the bank discriminated against anyone not a foreign born, highly paid (mostly) engineer. The bank refused to allow most people from joining (I tried, as a test)

I think the bank eventually went to some private investment company who happened to own another American bank for their daily banking needs of its customers.

Regardless, these very smart engineers have had more than 20 years to figure out how to by-pass the IRS and, I suspect, successfully.

These people never intended to keep their citizenship and viewed the whole process as just another requirement to work freely in the U.S.

Oh, most of the Chinese engineers were/are working as agents for their governments (though they and China deny it) and I doubt any secret, nationally or proprietorially hasn’t wound up in China.

If I renounce my citizenship and become an illegal does that mean I can be exempt from Obamacare for a few more years?

txhsmom on August 13, 2013 at 2:19 PM

Yeah, lurking in the shadows is really looking good right now. It’s just like being a citizen when you want to be (voting, sending your kid to public school, etc.) but without any of the responsibilities and duties that go along with citizenship.

The number of those expatriating is small, granted. But they have an effect far out of proportion to their numbers. Those who leave are not welfare cases expecting the Federal government to furnish international minutes for their Obamaphones. They are financially secure and savvy, and are entrepreneurs. It is the international equivalent of any business with half a lick of sense getting out of Detroit as the taxes and corruption made economic survival impossible. The number of business owners and investors who left was a miniscule fraction of the exodus from Detroit; but they were the critical mass. Absent them, Detroit was doomed.

Countries, cultures, empires, societies; they all rise and fall. They can recover, or they can commit suicide. Both the Democrat and Republican wings of the Statist “Governing Party” are intent on suicide. For those who can read the signs and have the means, moving on is the only rational thing to do.

When I retired, the pull of the west coast of Vancouver Island in Canada was strong. Family obligations and ties kept us here, but I remember that personally the other major downside to moving was their healthcare system. Now it seems that they will soon have a freer and better health care system than we will.

Dumb on the part of the US govt.
1. No way do US citizens want to start up businesses overseas.
They get double-taxed.
2. People with Green cards wanting to immigrate to the US will think twice about going through with with citizenship.
3. Foreign banks won’t want to open accounts for US citizens overseas because of the paperwork hassles.
4. Want a loan from a foreign bank for that new business you were going to start up in Europe? Forget it, no loans for Americans.

Anyhow, I still stand by my argument: I’m loyal the idea of America (as expressed in the Founding Documents), not the soil or the government. Seeing as how the US holds those principles in contempt, I am not against voting with my feet either. Once the US collapses many of the immigrants and most of the trespassers will leave. Joining them will be many citizens who have been disenfranchised. The question is where they will go.

For me, Japan seems nice (very far from perfect, but I could live there). Of course, that all depends on how they will be in the future.

In the 90s every Chinese citizen who received a U.S. visa had to get an exit visa from the Chinese government. This included the students who were very open, telling us (corporate security) that they had been instructed to take note of everything they did while working in the U.S. and be prepared to report on their activities when they returned to China. Any future exit visas depended on their cooperation with their government. Has that policy changed? I doubt it. If you want to leave China you got to pay the piper.

Shop manager routinely reported that returning Chinese engineers would ask for copies of internal company phone books prior to returning to China for vacation/termination of employment.

Security managers were tasked to make sure than soon-to-leave internationally returning foreign engineers did not bring cameras into their shops (personal cameras were forbidden throughout the facilities, including cel phones with cameras). We routinely seized camera film from employees during their final walk out.

You would not believe the junk that some employees (not just Chinese, but all foreign) tried to have mailed to their home countries at company expense. They were so lazy and cheap they never realized that we searched every package sent from our company out of country.

China’s goal of vacuuming up every piece of proprietary information, especially from high tech companies, is well establish. Several American companies delayed or cancelled plans to build plants in China in the 90s because the Chinese Government refused to promise that they would not nationalize the plants and proprietary information once they were built.

One famous CEO of a large semiconductor company personally assured the then premier of China that he would build a state of the art wafer fabrication plant in China if the premier gave the CEO assurance that the Chinese government would not nationalize it; the premier declined to offer that assurance.

The US has mutual tax treaties with most industrialized nations. The reporting is not onerous. A child could do it and US citizens are expected to file tax returns with the IRS. Bid deal. I’m personally glad that they are closing avenues for tax evasion by those able to operate overseas investments essentially tax free while the rest of us who are honest have to make up the difference with higher taxes.

Dumb on the part of the US govt.
1. No way do US citizens want to start up businesses overseas.
They get double-taxed.
2. People with Green cards wanting to immigrate to the US will think twice about going through with with citizenship.
3. Foreign banks won’t want to open accounts for US citizens overseas because of the paperwork hassles.
4. Want a loan from a foreign bank for that new business you were going to start up in Europe? Forget it, no loans for Americans.

albill on August 13, 2013 at 3:19 PM

Nonsense. If you start a business overseas it has no US liability. Foreign banks do open accounts for US citizens all the time. Loans are available to Americans in Europe.

I’m thinking the Netherlands. Mainly because of weather and they all speak English if they know you can’t speak Dutch. Although while casually learning Dutch vocabulary, it appears to be one of the easier languages to learn if your first language is English.

I don’t know what is wrong with these fat, spoiled American innovators and their spoiled union production workers.

You would think they invented the VCR and similar devices only to have most made over there or seen gangs of Chinese at district USPTO offices making copies of patents as fast as they were issued before the internet made it easier online. Or watched Russian and Chinese military tech look amazingly like older US stuff…